Gauging your worth in salary dollars

Web sites aim to arm workers with data

SAN FRANCISCO (CBS.MW) -- After five years working as a senior database developer, Joe Posner wanted to make a career move -- but not before knowing what salary he could command at a new job.

"You don't want to be quoting two thirds of what the market rate is for your job."
Joe Posner,Salary site user

"Given how much the IT market's changed in the last few years, I wanted to get a sense of what the rates were," Posner said.

The 30-year-old information technology professional estimates he visited 20 sites in search of a realistic range of competitive bids. After sifting through the offerings, he arrived at a benchmark within a margin of $5,000 to $10,000 that roughly reflected his skills and experience.

While the salary research never came up during the 15 interviews he had before landing a job as a senior engineer at Listen.com, it provided a needed context, Posner said.

"You don't want to be quoting two thirds of what the market rate is for your job," he said. "It looks unprofessional to be doing that and your employer won't take you very seriously."

Tools of the trade

"Historically, the power has always rested on the employer's side…"
Ed Lawler,Author

Tech stocks jobseekers aren't, but valuations can be as tricky on the job hunt as they are on Wall Street. Nowadays, a host of salary sites is giving career-movers access to what's previously been the domain of human resources departments: the tools to gauge their worth in the marketplace.

Career experts hail the sites for making salary information, typically private and difficult to compare, more widely available.

Even so, a democratization of data is putting jobseekers in a better position to bargain, said Ed Lawler, author of "Rewarding Excellence: Pay Strategies for the New Economy."

"It's certainly to the advantage of individuals to get a better sense of what they're worth in the labor market," Lawler said. "Historically, the power has always rested on the employers' side because they've had the information and the money to offer."

Focus on cash

Salary survey information has long been available through the Labor Department and in the journals of professional organizations. It's only recently emerged as an online destination of its own, with sites offering drill-down features that match salaries by industry, job title, description and location -- sometimes down to the zip code.

"There are people who don't leave companies because of us."
Kent Plunkett,Salary.com

While some sites spit out a flat number, others offer ranges with a national median, as well as relative high-end and low-end figures. Most sites are free, but others such as CompGeo and WageWeb.com offer detailed reports for a premium.

Sites such as Salary.com are enjoying a shift in sentiment as workers, now skittish about compensation that's tied to market performance, focus more on fixed pay.

The trend presents a challenge for companies, most of which prefer to pay modest increases in base salaries while augmenting packages with incentives to reward individual performance, said Steven Gross, employment compensation practice leader at William M. Mercer in Philadelphia.

"With the stock market creating all the volatility in stock options, what was once a sure thing…hasn't played out that well," Gross said. "That’s put more pressure on all the other elements in a compensation package."

John Challenger, chief executive of outplacement firm Challenger, Gray & Christmas, agreed that workers are focusing on their paychecks. "More people are asking for more money up front," he said.

That's just fine with Kent Plunkett, chief executive of Salary.com. "If I do my job right, I'm going to contribute to wage inflation in the United States," Plunkett said.

Perhaps the site's most important contribution to a tight labor market is its use in retaining key employees, he added. Productive workers who feel they're being underpaid can discover whether that's a reality worth bringing to the attention of human resources. "There are people who don't leave companies because of us."

Employers adjust

When it comes to hiring practices, companies have salary ranges for broad classes of jobs, and they settle on a rate after weighing a number of factors, said Paul Gavejian, compensation expert and principle with Buck Consultants. Take a typical range of $80,000 to $120,000, for example.

"The potential employer is going to greet this with mixed emotions."
Paul Gavejian,Buck Consultants

"If the market rate for a job is $100,000 and an untrained person were to apply for that job, as an employer, I would want to give them the $80,000 salary. As an employee, I would want to get $100,000."

An employee armed with survey data may stand a better chance of receiving the six-figure salary, Gavejian said. "The potential employer is going to greet this with mixed emotions," he said.

"The good news there for an employer is these are pretty astute people. They may be doing exactly what the new economy suggests that an employee should be doing to get a new job."

It's research well worth doing since many jobs are seeing above-average and even double-digit salary growth. A senior consultant for systems integration applying for a job this year instead of last year would earn 17 percent more now, while entry level e-commerce specialists grew their salaries 15 percent, and applications developers saw a 10 percent gain, according staffing service Robert Half.

And it's not just technology jobs that are appreciating -- salaries for payroll clerks and managers are 10 percent higher this year as well.

Benefits and limitations

Sites such as Salary.com have trouble reflecting the rapid-fire pace of change in the tech industry, said Patti Wilson, president of the Career Company in San Jose, Calif. Salaries tend to be too low for the San Francisco Bay Area, she said.

"As time goes by, you're probably going to get better and better quality surveys on the Web."
Pat Zingheim,Author

"When you're searching by job function like marketing, like advertising, like PR, you're going to get a range of salaries that bring in both the non-technical industries and the technical industries, and that brings down the level."

"What [tech employers] are finding they have to pay is more than what the job is worth," Coleman said, noting the company is working on making its resources more timely and accurate. "That particular region is something that is causing problems with everybody in the compensation world."

Jobseekers should do their own due diligence by attending trade shows, conferences, and getting on professional associations' email lists, Wilson said. "The best way to find out salary information is word of mouth."

She also advised workers to consider the full scope of compensation and work/life benefits that aren't included in the range, such as commute time, childcare, training and bonuses.

Jobseekers should use salary data sparingly and let the employer make a negotiable offer, Challenger said. "If you come in with a hard number and the company has a wage structure where they can't pay you that, then you've just knocked yourself out of the position," he said. "It can give you a base guideline, but I would take it with a grain of salt."

Sample size and quality is an element that can make or break a site's credibility, said Pat Zingheim, co-author of "Pay People Right!" Mercer's Gross agreed, saying sites that quote from self-reported surveys could be skewed because many people inflate their salaries or calculate them incorrectly.

Newly reemployed Joe Posner said he axed surveys that didn't account for regional variation or that used "statistically useless" sample sizes of 100 or less respondents from his working list of data. Still, finding salary data online was a positive experience, he said.

"It was pretty useful, although it took a lot more research than I would've liked to get that use out of it," Posner said.

That's a problem likely to be fixed sooner rather than later, Zingheim said.

"As time goes along, you're probably going to get better and better quality surveys on the Web," she said. "From the company's point of view, it's going to make them be a bit more on their toes than they've been in the past."

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